Salary Negotiation 101: New Employees

August 5, 2011
Posted by Link Staffing Services

It’s a ticklish moment when the job candidate you’ve worked hard to find decides to negotiate your initial salary offer. You don’t want to lose him/her. But you don’t want to overpay either. Here are a few tips to smooth out the process and get the results you want.

Conduct a Salary Survey

Before you make an offer, conduct a salary survey, focusing on the position and your location. This will give you a good idea of what other employers are offering. And what your parameters should be.

Determine the candidate’s value

There’s no such thing as an “average candidate.” The first step in determining the value of this person is to answer a list of specific questions. How desperately does your business need this person? Is it a challenge to find someone with the same skill set? Do you need to hire someone right away? Can you see this person staying with the business on a long-term basis? What is their potential for growth in this role? In the end, you need to have a clear picture of how much value the candidate holds for you.

Set your limits

The salary survey and candidate valuation are a start, but you’ll have to decide how far you’re willing to go, based on the economy’s climate, the job market, internal salary ranges, and your company’s budgets. It also helps to find out the candidate’s most recent salary and benefits. Many companies ask for salary information on the application.

You should also consider whether you have a pool of second-best candidates with similar profiles, giving you more options. Additionally, consider whether or not this person is currently employed somewhere else, making it easier for him/her to turn down an offer he/she perceives to be low.

Make a reasonable offer

Make your initial offer attractive to avoid protracted or difficult negotiations. If you choose to make an offer—or any part of it, such as salary—non-negotiable, make that clear.

Counteroffer Gracefully                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

If the candidate chooses to negotiate, stick to your limits on your counteroffer. If you cannot offer a higher salary, perhaps an incentive such as a bonus for the first year of employment, extra vacation time, stock options, a commission on top of base salary or reduced hours for the same pay may be within your means. Before offering any of these incentives, however, research federal laws. Some nondiscrimination rules may state that offering one employee more benefits than another is illegal.

You can also give the candidate an opportunity to prove himself by offering to increase his wage in increments. For example, if he/she is asking for a dollar more per hour, then offer fifty cents more after six months and another fifty cents more after a year.

By being firm with your salary range, determining the candidate’s value and knowing what your counteroffer options are, you can negotiate new-hire salaries confidently.


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